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BMHA under scrutiny over spending on 40 percent-vacant Perry complex

Federal auditors, who last month ripped into Buffalo Municipal Housing Authority financial practices, are back in Buffalo, this time examining spending at the authority's Commodore Perry housing development.

"We are starting new work at the housing authority," said Darryl Madden, a spokesman for the U.S. Department of Housing and Urban Development's Office of Inspector General.

While the recently completed Inspector General's audit criticized agency-wide practices and central office policies, this new review focuses on spending and policies over the past five years related to the hundreds of vacant and shuttered apartments at the Perry housing complex.

This latest audit may be a response to U.S. Rep. Brian Higgins' requests from 2017 and again in June 2018 that the HUD inspector general look into overall BMHA management as well as federal spending on vacant apartments that comprise more than a third of the Perry complex.

"I write to request that the Office of  Inspector General undertake an accounting of the federal funds invested  in these buildings before and after their vacancy to determine the extent to which federal resources have been used to perpetuate this blight on the surrounding community," Higgins wrote in one of two letters to HUD Inspector General Helen M. Albert.

"At Perry, tenants must endure disgusting and unsafe conditions as they reside next to portions of a complex which are disused, improperly sealed, and have become a haven for rats and a colony of feral cats," Higgins wrote in a second letter to Albert.

Federal officials issue scathing audit of BMHA spending

Gillian Brown, who was named BMHA executive director last month, said he recognizes the importance of ensuring federal money is being spent correctly, and the BMHA is doing its best to comply with the Inspector General's requests for information.

Brown added, however, that the back-to-back Inspector General audits are a burden to BMHA staff at a time when HUD is also conducting a comprehensive BMHA procurement review, and when the BMHA is continuing to address issues from the Inspector General's previous audit.

This latest audit comes about five weeks after the HUD Inspector General's office issued a scathing report on Buffalo Housing Authority's  general operations under the leadership of its former director, Dawn Sanders-Garrett. That audit found the BMHA has been improperly splitting contracts, with many jobs falling just below the threshold that would have required putting the work out to bid. It also charged the BMHA permitted a conflict of interest by awarding contracts to an organization whose executive director was married to the BMHA's assistant executive director.

The next Perry audit will look at everything from contracts and procurement to internal documents and staffing associated with the vacant Perry apartments.

Perry is a sprawling development on 41 acres lining Perry Street and South Park Avenue that is home to almost 1,000 people. The development consists of about 740 units — but some 40 percent are vacant.

There are six high-rise buildings with a total of 325 apartments, nearly all occupied. There are also 84 row house apartments built in 1956, most of which are rented.

And then there are about 330 of the original Perry apartments — the 1939-era flat-roofed, row house apartments. Almost all are vacant, having been boarded up and shuttered over the past two decades. BMHA officials have said the units are too run down to be occupied, but too expensive to repair or demolish.

The Perry development has gotten a lot of public attention in recent months as community activists focused on living conditions in the apartments, putting on Facebook photos and video that highlight continuing problems with mold, roaches and bedbugs.

But concerns about Perry have been ongoing for years.

The Buffalo News in 2016 wrote about the deteriorating conditions at the Perry apartments, with residents saying they feel like "forgotten people."

And Higgins in June called for a federal investigation into BMHA after he drove through the complex and found piles of debris dumped outside vacant Perry units, some of which were no longer boarded up. Higgins drove around Perry after The Buffalo News reported that Perry was among the complexes that had flunked HUD inspections over the past three years.

A pile of debris sits outside vacant apartments in the Commodore Perry housing complex in Buffalo. Rep. Brian Higgins took photographs while walking around the complex on Sunday, June 3, 2018. (Courtesy of Rep. Brian Higgins)

Higgins initially asked HUD to investigate the Perry development in 2017, after the BMHA all but ignored his suggestion that the agency consider selling some of the vacant properties to the private sector for development as low- and moderate-income housing as well as some possible market-rate housing.

The BMHA has drafted its own Perry redevelopment plans over the years, but has never been able to secure the necessary funds.

In 2011, the housing agency received a $250,000 federal grant to develop a $200 million "Perry Choice" plan to overhaul the Perry complex and its surrounding neighborhood. But the BMHA could not secure the development funds.

Rather than shifting the land to a private developer, the BMHA should push for a smaller version of the Perry Choice plan, the BMHA executive director said Friday,

"Some smaller version of that plan is what is necessary for this neighborhood. The problem is to find the money," Brown said.

Meanwhile, Perry residents often speculate that the BMHA and city aren't fixing up Perry on the chance that the Buffalo Bills will want the land for a future downtown football stadium. BMHA and city officials deny that.

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